Zeek 'winners' settle

Published: Tuesday, July 2, 2013 at 08:53 AM.

More than 100 people who profited through the alleged Ponzi scheme, Zeek Rewards, have agreed to settlements with a court-appointed receiver, court records show.

Receiver Kenneth Bell, who has collected more than $300 million for what he estimates as more than 840,000 victims of the program, asked a judge to approve the settlement agreements of 135 profiteers, totaling about $1.82 million, according to a motion filed Friday in U.S. District Court in Charlotte.

The agreed settlement total reflects a 56 percent return on the participating profiteers’ nearly $3.24 million in total winnings, Bell said in his motion.

Zeek Rewards was shut down by the federal government in August 2012 for operating an alleged pyramid and Ponzi scheme.

The U.S. Securities and Exchange Commission, which filed fraud charges and emergency asset freeze, alleged the company and its operators raised more than $600 million from about 1 million affiliates through the sale and offer of unregistered securities.

Bell made it clear early on that he intended to recover money from any person or group who “ought not have it.” He sent out subpoenas asking the program’s largest winners to forfeit their profits and took to a public website to ask profiteers to settle. Most recently, in April, Bell sent emails to all “net winners” who made more than $1,000 through the operation, notifying them they had until May 31 to settle.

Settlements involved profiteers who made anywhere from a little more than $1,000 to close to $570,000, according to court records. Of the nearly $1.82 million in total settlements, the receivership has received about $634,500 to date.

In his motion, Bell said the settlement agreements will minimize the risks, costs and delay of litigation against those who profited from the scheme.

Bell has said all along that anyone who profited from the scheme could be subject to clawback litigation.

Several of Zeek Rewards’ largest “net winners” requested to dissolve the receivership entirely. That motion is scheduled to be heard at 10 a.m. July 23 in U.S. District Court in Charlotte.

Victims of the alleged scheme have until Sept. 5 to file their claim with the courts. They must use a court-approved claims portal, which can be accessed at www.zeekrewardsreceivership.com.

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More than 100 people who profited through the alleged Ponzi scheme, Zeek Rewards, have agreed to settlements with a court-appointed receiver, court records show.

Receiver Kenneth Bell, who has collected more than $300 million for what he estimates as more than 840,000 victims of the program, asked a judge to approve the settlement agreements of 135 profiteers, totaling about $1.82 million, according to a motion filed Friday in U.S. District Court in Charlotte.

The agreed settlement total reflects a 56 percent return on the participating profiteers’ nearly $3.24 million in total winnings, Bell said in his motion.

Zeek Rewards was shut down by the federal government in August 2012 for operating an alleged pyramid and Ponzi scheme.

The U.S. Securities and Exchange Commission, which filed fraud charges and emergency asset freeze, alleged the company and its operators raised more than $600 million from about 1 million affiliates through the sale and offer of unregistered securities.

Bell made it clear early on that he intended to recover money from any person or group who “ought not have it.” He sent out subpoenas asking the program’s largest winners to forfeit their profits and took to a public website to ask profiteers to settle. Most recently, in April, Bell sent emails to all “net winners” who made more than $1,000 through the operation, notifying them they had until May 31 to settle.

Settlements involved profiteers who made anywhere from a little more than $1,000 to close to $570,000, according to court records. Of the nearly $1.82 million in total settlements, the receivership has received about $634,500 to date.

In his motion, Bell said the settlement agreements will minimize the risks, costs and delay of litigation against those who profited from the scheme.

Bell has said all along that anyone who profited from the scheme could be subject to clawback litigation.

Several of Zeek Rewards’ largest “net winners” requested to dissolve the receivership entirely. That motion is scheduled to be heard at 10 a.m. July 23 in U.S. District Court in Charlotte.

Victims of the alleged scheme have until Sept. 5 to file their claim with the courts. They must use a court-approved claims portal, which can be accessed at www.zeekrewardsreceivership.com.